Here’s what Kofi Annan thinks about Bill Gates and the modern philanthropist

Kofi Annan, the former UN Secretary-General from 1997 to 2006, took to LinkedIn to discuss his thoughts on the modern philanthropist. Its resurgence, he he said, “has been a major change for good,” especially the work of Bill Gates.

But how has this happened? “We have entered a new age of philanthropy and the sick, the poor and the vulnerable of our world are benefiting,” he wrote. “Progress is being made on some of our world’s most intractable problems and modern philanthropy has played a significant role in these successes.”

The philanthropists of today, he adds, are focused on being efficient and obtaining results. “They also bring a deep understanding of the need to build the widest possible partnerships with governments, international agencies, civil society and the private sector,” added Annan, who currently runs the Kofi Annan Foundation. “Despite fears from some NGOs and multilaterals about their involvement and influence, modern philanthropists rarely operate in isolation but recognise the importance of collaboration.”

Charitable giving is also becoming a global phenomenon and not controlled by individuals such as Andrew Carnegie, John D. Rockefeller and Alfred Nobel. “As the economies of Asia, Latin America and Africa have grown, so has the determination of its business leaders to use their wealth for the greater good,” he said.

How startups can save nuclear tech

A recent disturbing report predicts that despite a colossal number of new solar panels and wind turbines over the next quarter century, the planet will still face dangerous rising temperatures. Basically even if these widely embraced clean energy technologies are put on overdrive, we’re still probably screwed.

The report was understandably bearish on big growth in nuclear power. Following the tragic earthquake and accompanying meltdown of the nuclear reactors in Fukushima, Japan in 2011, new nuclear reactor construction has been largely halted in many countries. Public fear over safety, especially following such incidents, has long hampered the industry, and led to it being the sort of black sheep of clean power.

But four years after the infamous accident, environmentalists, nuclear advocates, and researchers are now looking at nuclear tech as an almost necessary way to generate power without carbon emissions that, if used correctly, could be crucial to help the world avoid the worst of global warming. And unlike with solar and wind, nuclear reactors generate power around the clock.

Tapping into this emerging sentiment is a new wave of entrepreneurs and investors, many in Silicon Valley, who are passionate about how tech innovation can lift the industry out of its nuclear stalemate.

The new guard are working within a nuclear industry that is stuck in the regulatory and financing patterns of old. Big conglomerates dominate and career nuclear execs are the norm. But the lack of interest in new tech and new ideas are in sharp contrast to the high stakes of averting planetary catastrophe.

Scott Olson/Getty Images

The Valley

Last month, beneath the high-vaulted ceilings of the sleek offices of Founders Fund, a venture capital firm that backed Facebook, Airbnb and SpaceX, sits a small group of these passionate nuclear evangelists. They are supposed to appear on a panel about nuclear energy that I’m moderating, but they’re actually far more interesting to listen to just chatting on their own.

There’s a spread of wine and cheese in one corner, and around the room are windows big enough to see the San Francisco Bay in the background. The wooden door into the office is so preposterously large that you can’t help but instinctively feel what they seem to be implying: We do big things. At one point, the firm adopted the motto “we wanted flying cars, instead we got 140 characters,” as a sort of dismissal of the preoccupation among many Silicon Valley investors with the next hot consumer app.

Last Summer, Founders Fund invested a small $2 million seed round into an early stage nuclear startup called Transatomic Power. Founded in 2011 by MIT nuclear scientists Leslie Dewan and Mark Massie, Transatomic Power is working on a nuclear reactor that uses molten salt and nuclear waste as a power source. While molten salt nuclear reactor tech is decades old, Dewan and Massie are using new designs and materials.

Dewan, who looks a bit like actress Amy Adams, is one of the clear leaders of this growing movement of nuclear entrepreneurs. The nuclear policy advocates in the room refer to her as “their secret weapon” that they use in meetings on Capital Hill to inspire and make connections. She’s young, well-spoken and doesn’t fit the profile of the typical nuclear industry exec.

She and the senior statesman in the room, venture capital icon Ray Rothrock, take turns interrupting each other to answer questions about the hurdles that face startups in the nuclear sector. Unlike Dewan, Rothrock fits the physical description of the typical nuclear exec, but he’s actually anything but.

Rothrock’s been a venture capitalist for over two decades. He backed Sun Microsystems early on, launched the Internet investing practice for VC firm Venrock in the early 90’s, and later formed the company’s energy investing practice. He also started his career as a nuclear engineer in the late 80’s and early 90’s before getting the investing itch.

Some of Rothrock’s nuclear ambitions are poured into a stealthy startup, Tri Alpa Energy, that is working on nuclear fusion (nuclear fission is what’s used in today’s reactors). Years ago Venrock backed Tri Alpha Energy, and the company now also has the financial support of the Russian government (through the nanotech company Rusnano), Microsoft co-founder Paul Allen, and Goldman Sachs. Rothrock is Tri Alpa Energy’s chairman.

Nuclear tech renaissance?

Dewan and Rothrock say nuclear tech is undergoing a period of rare entrepreneurial innovation. Rothrock says that compared to when he was in school, there are many more students today working on nuclear tech projects because of pressing climate change.

They cite figures of 55 nuclear startups with a total of $1.6 billion in funding. Rothrock says people don’t believe him when he says there’s that many startups working on nuclear technology. But those numbers are tiny compared to how many on-demand delivery startups, or mobile photo sharing startups, there are with millions of dollars from venture capitalists.

Founders Fund partner Scott Nolan, who made the investment in Transatomic Power, compares the nuclear entrepreneurial tech movement to what’s been happening in aerospace with young disruptor SpaceX and others. Nolan was an early employee at SpaceX and helped develop the propulsion systems used on the Falcon 1 and Falcon 9 rockets and the Dragon spacecraft.

Investors beyond Venrock and Founders Fund are starting to take notice. Last month the head of Silicon Valley accelerator Y Combinator, Sam Altman, said he was joining the boards of two nuclear startups. Helion Energy, which is building a magnet-based fusion reactor, and UPower, which has designed a small modular fission reactor, unusually went through the Y Combinator program.

Then there’s young nuclear fusion startup General Fusion, which is backed by Canadian venture capitalists Chrysalix Venture Capital, Amazon CEO Jeff Bezos, and the Canadian government. The company hopes to have a working prototype of its fusion reactor this year and an operating reactor in 2020.

Bill Gates has backed a nuclear startup called TerraPower, which was a spin off from the intellectual property incubator Intellectual Ventures. The company is working on a technology called a traveling wave nuclear reactor, which uses nuclear waste as a power source.

There’s also NuScale Power, which has been working on small, modular water reactors. Instead of the massive 1 gigawatt nuclear power generators that are in use today, NuScale Power makes a smaller 50 megawatt one (1,000 megawatts make 1 gigawatt).

Many of these nuclear startups, like Transatomic Power and TerraPower, are trying to address the issue of nuclear waste with their new reactor designs. That’s because the problem of what to do with the radioactive byproduct that results after a reactor has used up its fuel, is both complicated and important for the future of the nuclear industry.

Despite the dozens of nuclear startups these days, the sector is far from welcoming to entrepreneurs. Combining the difficulties of the startup world with the difficulties of nuclear technology is a colossal endeavor.

Nuclear technology can take decades to move from the lab into commercialization. Many nuclear startups don’t even give commercialization estimates because it can be so many years away. That makes it difficult for investors to back because they don’t know when they can expect a return.

The traditional nuclear industry also requires billions of dollars to get nuclear reactors built. The first nuclear plant under construction in the U.S. in decades, in Georgia, is estimated to cost $14 billion, and is now over budget and behind schedule.

Access to funding will plague all of the nuclear startups. NuScale Power faced a funding crunch and sold a majority ownership to Texas energy services company Fluor. Helion Energy is in the process of raising a round of $21.23 million and has closed on about half it.

But the biggest barrier for a nuclear startup could be regulation. It can take years to wade through the regulatory process of the U.S. Nuclear Regulatory Commission.

The NRC was born out of the Atomic Energy Commission of the 1940s, and its history is tied with nuclear arms proliferation and the military. It’s a closed, enforcing regulatory body and not equipped to deal with building relationships with entrepreneurs.

Construction workers surround the passive containment cooling water storage tank of nuclear Unit 1 in Sanmen — one of over two dozen new reactors being built in China today.Photo: STEFEN CHOW

Rothrock has been advocating for an entirely new federal nuclear agency that would operate like the federal Food and Drug Administration. When pharmaceutical companies submit drugs for approval with the FDA they have to meet certain milestones with their studies and prove that it works. Rothrock thinks an ‘FDA for nuclear’ could create the same predictable milestones for nuclear reactors and enable entrepreneurs and startups to get their new reactor technologies off the ground much more quickly.

If Rothrock and Dewan can help deliver changes in the nuclear tech industry, it could help open up this much neglected sector to some of the brightest and passionate young minds. Instead of flocking to Silicon Valley to create mobile apps, maybe the top students will turn to nuclear, like Dewan did.

And if the U.S. nuclear industry doesn’t change, many of these innovations will be commercialized overseas. China’s appetite for any new power generation tech is voracious. Russia is also particularly interested in new nuclear power.

Dewan and Rothrock have an important mission. With climate change looming on the horizon, nuclear technology could be the planet’s best hope.

The lonely energy projects left behind by the clean energy evolution

Ultra low cost solar panels and lithium ion batteries are remaking how homeowners, businesses and utilities use energy. But dramatically cheaper prices for these technologies in recent years also means that other early innovations once seen as the future are now far less competitive.

The result: A number of one-of-a-kind experimental energy projects that may be the first and last of their kinds. These lonely pioneers show just how rapidly clean energy technology has evolved to leave once promising ideas behind.

Such projects, which in theory can live on generating or storing energy for years, can act as both a cautionary tale, and an inspiration, for the entrepreneurs that seek to follow in their footsteps. They’re like the last living members of a short-lived species that ended up as an evolutionary dead end.

Solar thermal technology was one of the biggest and most highly touted industries to be bypassed partly by the cheaper alternative. On the largest of these plants, thousands of car-sized mirrors reflect sunlight onto skyscraper-sized towers that get so hot and shine so bright, it hurts your eyes to look directly at them.

At the end of 2013 and the beginning of 2014, companies built a handful of big solar thermal projects in the U.S. Southwest. The most well known of these is Ivanpah, a Hoover Dam-sized plant built outside of Las Vegas on five square miles of the Mojave Desert.

PRIMM, NV – FEBRUARY 20: The Ivanpah Solar Electric Generating System is seen in an aerial view on February 20, 2014 in the Mojave Desert in California near Primm, Nevada. Photo by Ethan Miller/Getty Images.

Ivanpah uses 347,000 mirrors and three huge 450-foot towers to produce enough electricity for 140,000 average American homes. It took more than seven years of development, including over three years of construction, and a $1.6 billion U.S. government loan to get built.

I visited the farm several times during construction as well as on its official launch day in February 2014, when U.S. Energy Secretary Ernie Moniz cut a bright blue ribbon and the pop band The Fray hung out (they filmed a video at Ivanpah the year earlier).

But even at its flashy ceremony, the uncertain future of solar thermal technology in the U.S. was one of the big topics of the day. A year and a half later, and with even lower solar panel prices, it’s looking even less promising.

The Solar Energy Industry Association recently called the prospects for new U.S. solar thermal plants in 2016 “bleak” considering the higher costs, the long time lines and the impending reduction of an important federal tax credit. Three big solar thermal projects from major developers have been put on hold indefinitely.

Another type of solar tech that is meeting a similar fate, is called “solar concentrating photovoltaics.” It’s a hybrid technology that uses mirrors and lenses like the solar thermal industry combined with mini solar panels that are highly efficient.

GreenVolts was just one of several companies focused on solar concentrating photovoltics that built a demonstration project or assembly line, and then shut down. Another company, Amonix, built a factory in North Las Vegas in 2011 and then closed it about a year later. The collapse came after Amonix took in $20 million in tax credits and grants, and over $100 million in venture capital funding.

No one can forget the infamous story of Solyndra, the solar panel maker that went bankrupt after getting a $535 million loan backed by the U.S. government. The disaster became a rallying point for Republicans against the Obama administration, and had a freezing effect on both the solar industry and political support of clean energy. But Solyndra was actually just one of these unfortunate companies that got caught up in the drop in silicon solar panel prices.

Solyndra made a solar panel technology using a material called CIGS (for copper indium gallium selenide), which it wrapped into tubes. It was just one of dozens of now defunct startups operating in this niche industry.

Savant Automation guided vehicles sit on display to be auctioned off at the Solyndra building in Fremont, Calif.., U.S., on Wednesday, Nov. 2, 2011: David Paul Morris/Bloomberg via Getty ImagesPhotograph by David Paul Morris — Bloomberg via Getty Images

Even projects that use traditional silicon solar panels will look quite different in a couple years than they do today. In recent months, a series of massive solar panel farms have started production in California. The biggest among them produce 550 megawatts and 579 megawatts, making them the world’s largest (a large natural gas, nuclear or coal plant can be about 1,000 megawatts).

But projects of that size — spurred by California utilities’ attempts to meet a state clean power mandate — will probably be more rare going forward. In the future, utilities will likely propose solar panel plants that produce closer to tens to a 100 megawatts, because they are far easier to get permitted and approved by regulators.

While energy storage for buildings and the power grid is still an emerging market, low cost lithium ion batteries have started to have a big impact on the clean energy industry. In the same way that cheap solar panels have displaced some of these early solar technologies, lithium ion batteries could push out the earlier forms of energy storage.

Batteries from Asian manufacturing giants like Panasonic, Sony and Samsung are now inexpensive enough and reliable enough to become dominant. For example, utility Duke Energy has been storing the energy from a wind farm in lead acid batteries (the kind used in gas-powered cars) at a site in West Texas. But on Tuesday Duke said it plans to replace those batteries with lithium ion batteries from Samsung.

Companies like Tesla, led by CEO Elon Musk,, along with a dozen startups, are betting big on the trend of low cost lithium ion batteries. Tesla not only uses those batteries in its cars, but the company also says down the road its lithium ion-based grid battery business could even become bigger than its electric car business.

There’s been many creative options for energy storage that never made it out of the demonstration stage. Last year I visited a “big ass battery” on an almond farm about a hundred miles east of San Francisco. The unusual project, which used some hefty state and federal subsidies, stores the energy from solar panels in large tanks filled with iron and salt water.

A first, and last, of its kind battery at an almond farm, stores energy from solar panels in Turlock, Calif.Courtesy of EnerVault

Energy Cache, another company with unconventional ideas for storing energy, at one time was pushing what it called “gravel on ski lifts.” The company built a tiny pilot project in Irwindale, Calif., which was a system of buckets on a line that picks up gravel at the bottom of a hill, and moves the gravel to the top of the hill. When the process is reversed the gravel is moved back down the hill to power an electrical generator.

It sounded cool and had a fun video. But the company never seemed to move beyond the demo stage, and its founder has now left the company. The startup had raised a bit of money from Bill Gates and internet investor Bill Gross.

All industries have these types of cycles during which technology matures, and winners and losers emerge. The early dot-com industry was littered with ideas that seemed good at the time, but utterly failed like Pets.com and Kozmo.com.

But what’s unusual about these orphaned energy projects is that once they’re built they can operate as advertised for years. It doesn’t matter that they’re too expensive too mass produce. The “big ass battery” on the almond farm, for example, could theoretically work just fine for a long while as the sole example of this technology. If they’re storing usable electrons there’s no reason to dismantle them.

Such lonely projects provide both inspiration and caution to the energy entrepreneurs and developers that come after them. They’re a flawed species that doesn’t survive the harsh realities of evolution. And there’s something that’s both beautiful — in the creativity and the willingness to take a risk — and also quite tragic in the shattered dreams and lost promises.

Oftentimes, for companies that build experimental clean energy plants, the question isn’t whether the tech works. The question is whether the company create the technology cheap enough to make these systems at a mass scale.

For silicon-based solar panels and lithium ion batteries it appears to be a resounding yes. But for many other new energy technologies, it’s unfortunately no.

Listing failed energy technologies of the past shouldn’t necessarily be depressing (unless you’re an investor in one of these firms). It should instead highlight that the people who Bill Gates once described as the crazy energy entrepreneurs are still working hard on breakthroughs in energy tech, or what he call “energy miracles.”

Bill Gates is doubling his billion-dollar bet on renewables

Bill Gates reckons he has already dropped a cool $1 billion on investments in renewable energy technologies. Now he’s looking to double that.

Gates, who according to Forbes will still have at least $78 billion left even after he’s placed his new bets, said in an interview with the Financial Times that investing in radical, ‘wild-eyed’ energy tech companies is the only way that the world is going to get the solution to climate change at an affordable economic cost.

Current technologies, he said, were too expensive.

“The only way you can get to the very positive scenario is by great innovation,” he said. “Innovation really does bend the curve.”

Gates wasn’t impressed by those who claim their new battery and energy story technology can solve the problem of unpredictability that dogs renewable sources such as wind and solar.

“There’s no battery technology that’s even close to allowing us to take all of our energy from renewables and be able to use battery storage in order to deal not only with the 24-hour cycle but also with long periods of time where it’s cloudy and you don’t have sun or you don’t have wind,” Gates said. “Power is about reliability. We need to get something that works reliably.”

Gates said that the scale of the challenge and the extent of the possibilities demand that government puts “tens of billions” into researching and developing renewables. He drew comparisons with the vast resources thrown at the Manhattan and Apollo projects that made the atomic bombs and put men on the moon.

Gates has already invested “several hundred million dollars” in ‘nuclear recycling’ according to the FT, with much of that put in a company called TerraPower, which is trying to develop reactors that will run on depleted uranium, a waste product of today’s nuclear plants.

“Nuclear technology today is failing on cost, safety, proliferation, waste and fuel shortage, and so any technology that comes in has to have some answer to all of those things,” he said.

Other technologies Gates spoke warmly of included “solar chemical” power, which uses a process akin to photosynthesis to use sunlight to convert water into hydrogen fuel, and high-altitude wind power, which attempts to tap the energy of jet stream winds that blow 20,000 feet above the ground.

Bill Gates thinks Uber has the best shot at self-driving cars

Driverless cars have become a moonshot project for tech companies around the world, and Microsoft’s MSFT Co-founder and world-leading philanthropist Bill Gates believes there’s one company that will rule the space.

In a conversation with Financial Times Editor Lionel Barber at an event in London Wednesday, Gates shared his thoughts on issues ranging from the global economy to robots to Silicon Valley. Gates said a real tipping point for change in driving will come from self-driving cars, calling it “the real rubicon.” And Uber is primed to take the lead, he added.

FT Alphaville writer Izabella Kaminska live-tweeted Gates’ thoughts:

When asked about the effects of digital serf-Esque platform monopoly models like Uber which turn people into an outsourcing precariat…

If Gates is correct, it will validate recent moves by Uber to invest in self-driving technology. Earlier this year, Uber announced a partnership with Carnegie Mellon University to create the Uber Advanced Technologies Center in Pittsburgh “to do research and development, primarily in the areas of mapping and vehicle safety and autonomy technology.”

CEO Travis Kalanick has made it no secret that his company sees a future where we drive without our hands on a steering wheel. “The reason Uber could be expensive is because you’re not just paying for the car, you’re paying for the other dude in the car,” Kalanick said in a conference last year. “So the magic there is you basically bring the cost below the cost of ownership for everybody, and then car ownership goes away.”

The move has set Uber up for a battle with Google GOOG. Last year, at the Code Conference, the tech giant made public a two-seater, self-driving car after years of research. Both companies, however, will have to battle the public’s perception on giving up control of a car. A survey conducted by NerdWallet found that only 37% of women and around half of men expressed any interest in owning a self-driving vehicle.

College dropout Bill Gates says we need more college grads

Despite never finishing college, Microsoft co-founder Bill Gates is urging today’s students to graduate with a university degree, touting it as “a much surer path to success.”

It’s a message contrary to some other tech luminaries in recent years who’ve discouraged younger people from taking on unmanageable debt for a degree that may not prove worth its cost.

But Gates, who dropped out of college to start Microsoft, points out that by 2025 two-thirds of all jobs in the U.S. will require education beyond high school. At the rate the U.S. is currently producing college grads, the nation is looking at a shortfall of 11 million skilled workers to fill those rolls over the next 10 years, according to a study by Georgetown University.

And the payoff is worth it, says Gates.

College graduates are more likely to find a rewarding job, earn higher income, and even, evidence shows, live healthier lives than if they didn’t have degrees. They also bring training and skills into America’s workforce, helping our economy grow and stay competitive. That benefits everyone.

It’s just too bad that we’re not producing more of them.

The problem isn’t that enough people aren’t going to college, Gate’s points out. It’s that not enough are completing those degrees. More than 36 million Americans have enrolled in college and left without a degree in hand. There are many reasons behind why students drop out–and poverty is a key issue.

This is what keeps Bill Gates up at night

Bill Gates is the richest man in the world. He essentially invented personal computing and co-founded a major multinational corporation. But what really keeps him up at night has nothing to do with technology–it’s about humanity.

“I rate the chance of a nuclear war within my lifetime as being fairly low,” Gates told Vox’s Ezra Klein. “I rate the chance of a widespread epidemic, far worse than Ebola, in my lifetime, as well over 50%.”

Gates, who is 59 years old, referenced a death chart that shows the rise and fall in number of deaths throughout the 20th century. There was a spike during World War I, about 25 million, and another for World War II, about 65 million. In the middle of those two eras, you’ll see a spike that’s almost as large as World War II.

“Well, that was the Spanish flu,” said Gates.

The 1918-1919 Spanish flu pandemic killed somewhere between 30 and 50 million people, according to recent estimates. Given the delayed global reaction to the Ebola crisis in Africa, Gates fears that we are not ready to effectively battle a wide-reaching epidemic.

Controlling the spread of a virulent disease is even more complicated today, given that 50 times more people cross borders now than they did in 1918, according to Gates’ modeling. Using an algorithmic model, Gates estimates that a Spanish flu-like disease could kill 33 million people in 250 days.

“Within 60 days it’s basically in all urban centers around the entire globe,” Gates said. “We’ve created, in terms of spread, the most dangerous environment that we’ve ever had in the history of mankind.”

Watch: Proof Bill and Melinda Gates are ice cold under pressure

Red nose day—a U.K. campaign launched this year in the U.S. by NBC to “[raise] money for children and young people living in poverty by simply having fun and making people laugh,” culminated Thursday night in a three-hour television special that featured celebrities like Kim Kardashian and Will Ferrell.

But it wasn’t just walkers of red carpets that got in on the action. Microsoft co-founder and former CEO Bill Gates and his wife Melinda also filmed a video pitch in support of red nose day and it’s poverty-fighting mission, though things didn’t quite goes as they planned.

Here’s what’s on Bill Gates’ summer reading list

The richest man in the world still makes time to squeeze in a good book now and then.

Bill Gates—he of the $79 billion net worth, per Forbes—released his annual summer reading list on Tuesday. In between running one of the world’s largest charities and serving as technological advisor to the company he co-founded, Microsoft MSFT, Gates has made a habit in recent years of letting the world know what he’s reading.

Gates unveiled his new 7-book summer reading list in a post titled “Beach Reading (and more)” on his personal blog, Gates Notes. Included in this year’s list is The Magic of Reality, by Oxford University evolutionary biologist Richard Dawkins. There’s also On Immunity, by Eula Biss, which fits in well with one of the goals of the Bill & Melinda Gates Foundation by tackling the issue of childhood vaccinations.

The billionaire techie also noted that he’s trying to lighten the mood a little bit this year. “This year I tried to pick a few more things that are on the lighter side. Each of these books made me think or laugh or, in some cases, do both,” Gates wrote in the blog post.

In that vein, Gates includes a book adapted from Allie Brosh’s popular comic blog, Hyperbole and a Half, which Gates calls “funny and smart as hell.” Another item with a more graphic option is Randall Munroe’s XKCD, which draws from Munroe’s webcomic of the same name, which features a lot of mathematical and scientific humor. “It’s that kind of humor, which not everybody loves, but I do,” Gates writes.

The rest of the books Gates recommends reading this summer are: What If?, also by Munroe; How to Lie With Statistics, by Darrell Huff; and, Should We Eat Meat?, by Vaclav Smil.

Shares of the major publicly owned retail chains – Penske Automotive PAG, AutoNation AN, Lithia LAD, Group One GPI and Sonic SAH – swiftly rose from 2% to 7% in sympathy with the hypothesis that Soros was considering an acquisition.

Soros isn’t the first ultra high net worth individual to be attracted to U.S. retail car dealerships, which can be acquired in large number via a single purchase of a large chain. Nor was Warren Buffett, who agreed in October to buy the Van Tuyl chain, the nation’s biggest privately owned group. Nor was Bill Gates, who owns 15% of AutoNation, itself a rollup of individual dealerships created by billionaire Wayne Huizenga, who got his start hauling garbage.

What is the investment allure of car dealerships? Since dealerships are franchises granted by automakers, they represent a type of cartel, well protected by state laws. Auto dealers cooperate to limit competition, though dealers often quibble about whether the automakers allocate their territories fairly. Although profit margins on vehicles have been getting slimmer due to increasing price transparency made possible by the Internet, cash flow remains prodigious (“cash is king!”) from consumer purchases of used and new vehicles, maintenance, insurance and financing.

On the minus side, U.S. corporate taxes on profits are high. The amount of debt needed to finance vehicle inventories is substantial. Capital costs can be crushing, too, when automakers pressure stores to renovate properties or introduce new design themes.

Some analysts believe that online vehicle buying eventually will replace all or part of buying at dealerships, rendering them much less valuable than they are today.

Dealerships aren’t too difficult to buy; but they are complicated businesses to run well. Private-equity firms have tried to enter automotive retailing; but automakers, which must approve new franchises, dislike private equity’s tendency to load dealerships with debt and sell them after a few years.

And then there are the pitfalls. In December, for example, the Federal Trade Commission cracked down on Trophy Nissan in Mesquite, Texas, for what the FTC described as deceptive advertising used to sell and lease cars. Trophy agreed to settle charges with the FTC – but the episode is bad publicity for the dealership, not to mention for its owner-in-waiting, Warren Buffett’s Berkshire Hathaway brk.a.

Berkshire Hathaway said it will complete its purchase of the Van Tuyl group by the end of March. The company also has said it may wish to grow larger by purchasing other dealerships. The auto companies, which have substantial leverage over transferring the franchises, may choose to insist on substantial capital investment in the dealerships as a condition. Buffett, with his long-term viewpoint on investment, likely wouldn’t be deterred.

Soros is a different sort of investor, having gained wealth and renown for his skill trading currencies, bonds, interest rates and equities. SUVs, sedans, oil changes and rustproofing treatments are quite another matter.